Computing Value of an Asset Based on Present Value
You have the chance to purchase the royalty interest in a gas well in the Barnett Shale Y mate is that the net royalty income will average $25,000 per year for seven years There will be no residual value at that time. Considering the uncertainty in your estimates, you expect to earn 9 percent per year on the investment. What should you be willing to pay for this investment now?
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